Trakx Weekly Update: June 3

Key Crypto Market Figures

CTIs Weekly Performance

Last week was a bit of a roller coaster in the world of crypto even though it may not be readily apparent from looking at the price action, which was subdued as evidenced by the Trakx Top 10 Crypto CTI dipping around 1%. Topping the performance tables last week was the Diversifier CTI, up 6%, while the weakest performer was the Decentralized Exchange CTI, after it slipped 7% over the prior seven day period.

The roller coaster ride in question relates to US political attitudes towards crypto, specifically those of President Biden and his administration. Earlier in the month, the US Senate passed a resolution to rescind the SEC’s SAB 121 rule, which impinges the ability of tradfi banks to offer crypto custody services. Prior to the Senate vote, the White House released a statement warning that Biden would veto the legislation if the Senate passed the resolution. However, after the resolution passed with a healthy 60-38 final vote, and with many leading Democrats supporting it, the expectation was that Biden would cave and not use his veto. Indeed, crypto investors started to sense that US politicians were finally warming to crypto and this provided a boost to prices at the start of the week. Unfortunately, this optimism proved misplaced, as last Friday Biden stuck to his guns and notified Congress that he had vetoed the resolution even in the face of strong cross-party support because, in his view, the resolution “risks undercutting the SEC’s broader authorities regarding accounting practices”.

By contrast, Trump, who is still the presumptive Republican presidential nominee for the 2024 election despite last week’s convictions for falsifying business records, continued to position himself as the more crypto-friendly candidate. In fact, his team announced that it had collaborated with OpenNode (a Bitcoin infrastructure provider) to facilitate Bitcoin donations to his election campaign via the Lightning Network – a first for any US presidential candidate. In light of these recent developments, it seems pretty clear that crypto will remain a key area of contention between the two candidates and is likely to feature prominently in the presidential race between now and the November vote.

Staying with the theme of criminal convictions, former co-CEO of FTX’s Bahamas subsidiary, Ryan Salame, was sentenced to seven and a half years in prison having last year pleaded guilty to charges of operating an unlicensed money transmitting business and violating campaign finance law. The sentence given by Judge Kaplan, who also presided over SBF’s earlier trial that resulted in a 25 year sentence, was harsher than many expected. Former FTX employees Caroline Ellison, Gary Wang, and Nishad Singh who are also awaiting sentencing after having previously submitting guilty pleas must be hoping their cases will be heard by a different judge.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• President Biden Vetoes Pro-Crypto Resolution, Defends SEC’s Judgement: Decrypt.
• Trump Breaks Ground as First President To Allow Bitcoin Lightning Donations for Campaign: BTC Times.
• Crypto exchanges see $3B Ethereum exit since ETF approvals: Cointelegraph.
• Fetch.ai, SingularityNET, Ocean Protocol Set Date for Artificial Superintelligence Alliance Token Merger: Coin Desk.
• Convicted FTX exec Ryan Salame may serve shorter sentence because of substance abuse: DL News.
• US major predicts Bitcoin recognition as a weapon system as catalyst for $100 million price target: CryptoSlate.

Trakx News

• Ryan Shea published: Dollar Collapse: Why is it taking so long and what does it mean for crypto?
• We are organising a Webinar (in French) for our IFAs clients, on Thursday the 6th of June at 11am CET covering the latest news and trends in the crypto market and Trakx’s managed account offering by risk profile, specifically designed for wealth management advisors. Join us and register here: https://lu.ma/utznvbfa

Trakx CTIs Performance

Sources: Coingecko and AlphaVantage

*Return of bitcoin is calculated since 01/05/2020, while CTIs performances were calculated since their respective launch date.
**Includes simulated performance.
***The risk signal is determined according to the historical volatility level, the higher the riskier.